"Approximately 15 per cent of the total workforce, which amounts to 500 employees, was made redundant," says a Nakheel spokesman.
He describes the decision as "a responsible action considering the current global market conditions."
"We have the responsibility to adjust our short-term business plans to accommodate the current global environment.
"The redundancies are indeed regrettable, but a necessity dictated by operational requirements which are in turn dependent on demand," says the spokesman.
All the affected employees have been offered a redundancy package, which includes outplacement support services to relocate the laid-off staff, to assist in this time of transition.